One of the few people I've gotten to know who actually went to prison for mortgage fraud is a 50-year-old grandmother from Southern California named Maria Echeverria. Things are looking up for Echeverria since I first interviewed her last year. She has been moved from a federal prison camp in Victorville, Calif., 85 miles northeast of Los Angeles, to a half-way house that allows...

This "The borrowers defaulted, yet the borrowers weren't indicted. Nor were executives at the mortgage companies that helped create the subprime-lending machine she was feeding." and this "It is easier to count the number of top executives convicted for mortgage fraud than all the little people who peddled exotic loans to deadbeat borrowers." are not explained. Why not ask the San Diego US Attorney why this is so? I think that much of the rage now in American politics centers on questions like this. Clearly the brokers were directed to conduct business in this fashion. Why no justice? Come on Al, make a phone call.

I'm sorry, "I was just doing what the lenders told me to do" is a crock of crap. Did they tell her to fake up income documentation? If so, why didn't the people who did that go to jail too?

The shame of it is that stated income loans weren't created to enable people to lie about their income - they were created so that highly qualified borrowers could avoid having to send in 200 pages of tax returns. And, yeah, if a borrower has perfect credit, minimal debt, 20% down, a verifiable business, and half a million in the bank, then waiving the tax returns makes sense. But the problem is that lenders were letting people with so-so credit, lots of debt, very little down, and very little assets inflate their income ridiculously, and these folks were getting loans. We're talking about teachers, teachers, waitresses, clerical workers, hairdressers, and the like claiming $200,000 annual incomes. I saw it happen every day. And that problem started with a loan officer or broker who was willing to lie about that borrower.

THIS sort of garbage - not lending to people in poorer areas, as conservatives would like us to believe - was the root of the problem. And we all paid for it with this economic downturn and less money in our pockets due to lower home prices.

Boss302 wrote:The shame of it is that stated income loans weren't created to enable people to lie about their income - they were created so that highly qualified borrowers could avoid having to send in 200 pages of tax returns. And, yeah, if a borrower has perfect credit, minimal debt, 20% down, a verifiable business, and half a million in the bank, then waiving the tax returns makes sense. But the problem is that lenders were letting people with so-so credit, lots of debt, very little down, and very little assets inflate their income ridiculously, and these folks were getting loans. We're talking about teachers, teachers, waitresses, clerical workers, hairdressers, and the like claiming $200,000 annual incomes. I saw it happen every day. And that problem started with a loan officer or broker who was willing to lie about that borrower.

That's probably the true, but it was not part of the lenders' guidelines or the underwriting process and should have been. Approving loans based on undocumented income was one of the primary causes of the mortgage meltdown. Another cause of the push to relax lending standards -- by every administration starting with Carter -- so that millions of people who couldn't really afford home ownership could buy a home, which made every President's economic numbers look better.

But the biggest cause of the problem was the pervasive belief that "real estate values always go up," and everybody in the process, from the President to Congress to Freddie and Fannie to the lenders on down to the borrowers themselves were guilty of that. This led to the refi boom of 2000-2006 that allowed 2nds and 3rds in excess of 100% CLTV and a massive increase in debt-consolidations and home improvement loans that, in the short run, kept us out of a recession, but in the long run led to the meltdown we are experiencing.

This lady's job was to tell borrowers what they could do under the rules of the game, and "liar loans" were permitted. Providing false statements from an accountant were not. There in lies the crime.

An equally serious crime is talking to Lewis on the phone during a Bronco game. She should be sent back to prison for that.

The essence of government is when ordinary people get themselves appointed or elected to positions of power, use that power to make rules to dictate how other people must live their lives, and enforce those rules at the point of a gun.

Inhumane is not considering the outcome of the lives you destroyed. Did you ever wonder what happen to the self-employed borrowers, the incomes you altered behind their backs that were left holding the bag. Oh, let me fill you in.

Since the crisis we got ripped-off from some of your fellow brokers opening up fake mortgage rescue companies. We'd got the lender run around with B.S. modifications that never were going to happen since we didn't qualify for the loan in the first place. We closed the doors to our businesses due to the crisis. We cheaply sold off or threw away our possessions just so we could move in with family. You had taken all of our savings from deposits, fees, and adjustable payments. Families and relationships broken up. Pets euthanize.We have nothing left! Get it! We are homeless! We don't have the pleasure of starting over!

I sure hope when you're writing your I'm a born again poor poor pitiful me book, you think about the lives you destroyed because it sounds like you've learned nothing. Have fun opening up your bakery with your ill-gotten commissions. B_tch.

Iget_it wrote:Inhumane is not considering the outcome of the lives you destroyed. Did you ever wonder what happen to the self-employed borrowers, the incomes you altered behind their backs that were left holding the bag. Oh, let me fill you in.

Since the crisis we got ripped-off from some of your fellow brokers opening up fake mortgage rescue companies. We'd got the lender run around with B.S. modifications that never were going to happen since we didn't qualify for the loan in the first place. We closed the doors to our businesses due to the crisis. We cheaply sold off or threw away our possessions just so we could move in with family. You had taken all of our savings from deposits, fees, and adjustable payments. Families and relationships broken up. Pets euthanize.We have nothing left! Get it! We are homeless! We don't have the pleasure of starting over!

I sure hope when you're writing your I'm a born again poor poor pitiful me book, you think about the lives you destroyed because it sounds like you've learned nothing. Have fun opening up your bakery with your ill-gotten commissions. B_tch.

What I read in your rant is that your business wasn't successful enough to qualify for a conventional loan, so a mortgage broker helped you get the loan you wanted to buy the home you wanted by exploiting the irrationally lax lending standards of the day, and when you were unable to make your business more profitable and were unable to meet the financial obligations you willingly committed yourself to, you choose to point fingers at everyone else. You should run for Congress.

The essence of government is when ordinary people get themselves appointed or elected to positions of power, use that power to make rules to dictate how other people must live their lives, and enforce those rules at the point of a gun.

Ctajm wrote:This lady's job was to tell borrowers what they could do under the rules of the game, and "liar loans" were permitted. Providing false statements from an accountant were not. There in lies the crime.

The rules of the game varied from lender to lender. Some would not look at stated loans if the scenario was not reasonable (I worked for WaMu and they'd deny the outright fraudulent ones, such as one for a teacher who said he was making $250,000 for teaching high school English in DPS - I kid you not). But there are outfits who wouldn't bat an eye at that kind of crap. That took a loan officer AND a lender who were wiling to commit fraud. No one had to submit a fraudulent or doctored-up income document for that - they just had to bet that the lender would simply ignore reality and common sense.

And while I'd agree Fannie/Freddie weren't totally innocent in all this, the fact remains that even for their highest-risk loans, they always required full income and asset documentation, so the borrower had to prove he could afford the house, even with the expanded ratio guidelines. That's why their default rate is about 5%, while the default rate on the real subprime liar-loan crap loans is closer to 30%. I've been in the business 11 years - Fannie/Freddie were the GOOD guys in all this. It was the outfits like Countrywide, WaMu, New Century and the like that got us where we are now. Particularly Countrywide...why Angelo Mozilio is not in prison is beyond me.

Iget_it wrote:Inhumane is not considering the outcome of the lives you destroyed. Did you ever wonder what happen to the self-employed borrowers, the incomes you altered behind their backs that were left holding the bag. Oh, let me fill you in.

Since the crisis we got ripped-off from some of your fellow brokers opening up fake mortgage rescue companies. We'd got the lender run around with B.S. modifications that never were going to happen since we didn't qualify for the loan in the first place. We closed the doors to our businesses due to the crisis. We cheaply sold off or threw away our possessions just so we could move in with family. You had taken all of our savings from deposits, fees, and adjustable payments. Families and relationships broken up. Pets euthanize.We have nothing left! Get it! We are homeless! We don't have the pleasure of starting over!

I sure hope when you're writing your I'm a born again poor poor pitiful me book, you think about the lives you destroyed because it sounds like you've learned nothing. Have fun opening up your bakery with your ill-gotten commissions. B_tch.

And you hold no responsibility here?

1) When you closed on that loan, you had to sign and date a final application that clearly listed your identifying information, assets and income. If the income used was fraudulently stated, then you, my friend, committed fraud.

2) I find that difficult to believe that anyone - much less a business owner - would take out a loan not knowing what the terms were.

I'm sorry your life has been affected by this but it takes two to tango, Bubba...and you were dancing right along with the person who arranged that loan for you.

And lest we forget...while we're on the topic of misery, let's take a look at the misery YOU caused by taking part in this fraudulent loan that screwed up your life. The bottom line is that your life wasn't the only one that got screwed up.

You screwed the lender out of money you promised to pay them, which lessened their profits, and thereby put their workers at higher risk of being laid off.

Your foreclosure tanked the property values for every home in your immediate vicinity, which took money right out of the pockets of everyone in that area, including all the people who actually qualified for their homes without committing fraud.

The drop in housing prices in your area meant that people who needed to refinance to get out of a loan that wasn't working for them didn't have enough equity to do so, and pretty much all of them lost their homes as a result. They all probably endured the same hardships you did.

And you helped contribute to the worst economic collapse since the Great Depression.

How's that for misery? All because you just couldn't live without having a mortgage you didn't qualify for.

1) When you closed on that loan, you had to sign and date a final application that clearly listed your identifying information, assets and income. If the income used was fraudulently stated, then you, my friend, committed fraud.

Sorry Boss302

Your right the loan application had to be signed at closing. It states in the loan docs that broker is to provide the loan app. to be resigned at closing in front of interviewer. It doesn't arrive. It didn't happen. Already proved it. Already turned it in. Know what you're talking about before making assumptions pal.

Iget_it wrote:Inhumane is not considering the outcome of the lives you destroyed. Did you ever wonder what happen to the self-employed borrowers, the incomes you altered behind their backs that were left holding the bag. Oh, let me fill you in.

Since the crisis we got ripped-off from some of your fellow brokers opening up fake mortgage rescue companies. We'd got the lender run around with B.S. modifications that never were going to happen since we didn't qualify for the loan in the first place. We closed the doors to our businesses due to the crisis. We cheaply sold off or threw away our possessions just so we could move in with family. You had taken all of our savings from deposits, fees, and adjustable payments. Families and relationships broken up. Pets euthanize.We have nothing left! Get it! We are homeless! We don't have the pleasure of starting over!

I sure hope when you're writing your I'm a born again poor poor pitiful me book, you think about the lives you destroyed because it sounds like you've learned nothing. Have fun opening up your bakery with your ill-gotten commissions. B_tch.

What I read in your rant is that your business wasn't successful enough to qualify for a conventional loan, so a mortgage broker helped you get the loan you wanted to buy the home you wanted by exploiting the irrationally lax lending standards of the day, and when you were unable to make your business more profitable and were unable to meet the financial obligations you willingly committed yourself to, you choose to point fingers at everyone else. You should run for Congress.